According to a recent Reuters report, another backlash against large sport utility vehicles is forming in Oregon. The news agency said Oregon’s state government is seeking to pass a law that would make buyers of big SUVs pay more in local taxes if they claim them as a business expense in their federal tax returns.
At stake, Reuters noted, is a federal tax loophole that lets small business owners reduce their taxable income by as much as $75,000, a limit that was recently raised from $25,000 under the tax cut legislation President Bush signed into law in May.
Oregon legislators, who are grappling with a $2 billion budget shortfall, reportedly said the federal SUV tax break is costing the state valuable tax income worth some $750,000 a year, according to Reuters.
According to Reuters, under the proposed legislation, which is making its way through Oregon's state senate, businesses would be required to report triple the amount of their federal tax write-offs as income when they file their local tax returns.
The state law, if passed, would take effect from 2004 and apply only to larger SUVs rated over 6,000 pounds, the report added.
The bill is now before the Oregon senate's revenue committee, Reuters said.